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Marginal Revolution · September 23, 2026 · On the brief until October 7, 2026

The Price of Intelligence is Falling Rapidly

EconomicsData Science
THE AI ANGLE
Becoming cheaper to run at fixed performance levels

An Epoch AI report found that the cost of a given level of AI performance drops by an average of 47 percent every quarter. Newer models now match earlier test scores while requiring far less inference spending. This rapid price decline reduces the competitive threat from older open models.

Summary written by AI Business Lens with an AI model from the article at marginalrevolution.com. It is not the article, and the publisher has not reviewed it. For publishers.

THE TEACHING ANGLE
Students can examine whether shrinking inference costs will give proprietary frontier models a lasting economic advantage over open models.

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